SIE - Securities Industry Essentials Exam

Preview Mode

An options trader wants to profit from potential interest rate declines in the 10 year note. The trader could

Buy 10 Year note calls
A
Buy 10 Year note puts
B
Buy a straddle
C
Sell a strangle
D

Explanations

Remember that the yield and bond prices move inversely to one another. The correct answer is to buy 10 Year note calls.